I understand you may not have enough time to read my full OpenSea review, so here’s an actionable summary to help you in your research.
OpenSea has built the world’s biggest NFT exchange very quickly. Given the amount of funding they’ve acquired, the active user base, and the general hype revolving around the crypto field, you can expect to hear much more about OpenSea in the nearest future.
The key focus of OpenSea is the option of self-listing. Artists can create a marketplace for their NFTs without paying any commission or platform fees. In many ways, this is comparable to the status Uniswap has among crypto exchanges. Uniswap allows anyone to list cryptocurrencies on their platform, without a meticulous and time-consuming listing procedure. The same goes for OpenSea, but with respect to NFTs.
Artists can create their NFTs merely by inputting data sets like Name, Category, immutable and mutable data. The ownership of the NFT is assigned after creation, enabling artists to sell or transfer immediately. In this marketplace, artists can stay focused on creating artworks instead of worrying about the listing process.
OpenSea is also “compatible with open blockchain standards”, meaning that it is possible for you to create your work on other platforms, and then come back to OpenSea to sell your work there.
Details about the company
- Year founded: 2017
- Blockchain: Ethereum, Polygon, Klaytn
- Founder(s): Devin Finzer
- Funding: Venture Capital
- Token types: ERC721
- Accepted Cryptocurrencies: ETH, MATIC
- DAO: No
- Languages: English
- Prohibited countries: None
OpenSea was founded in 2017 by previous Credit Karma employee Devin Finzer. The company was accepted into the Y-Combinator program, which is an incubator for up-and-coming startups.
After raising nearly $5 million in early funding rounds and proving that the platform was a success, OpenSea secured $123,000,000 Series A and B investments from the very established and forward-thinking VC firm – Andreissen Horowitz (a16z). Once they completed the final round of funding in July 2021, OpenSea has since dominated every other NFT exchange.
Source: Dune Analytics
In July 2021, OpenSea’s NFT sales surpassed $3 billion in volume. The chart’s last bar measures October’s volume, and October was not even halfway over at the time of writing. As you can see below, the user base has been skyrocketing.
Source: Dune Analytics
The beauty of crypto is its transparency. The above charts are not from OpenSea itself but from a free website that enables users to analyze public blockchain activity and build graphics from them.
The primary complaint is the high transaction costs required to use the platform.
OpenSea is built on the Ethereum blockchain, which has drastically increased in popularity over the past few years. ETH’s price was around $150 in 2019 and in 2021 surpassed $4500. Not only has the price of ETH shot up, but the transaction fees on the Ethereum blockchain, otherwise known as gas, also have.
There are a handful of transactions you’re required to make to buy or sell an NFT on OpenSea. Each one can cost between $10 to $120 in gas, depending on the congestion of the network. This is not ideal, and the Ethereum developers are working on solutions to minimize fees, but it will not happen overnight.
In the meantime, users can also buy and sell NFTs using the Polygon network, which is a different blockchain that enables secure, instant transactions for Ethereum based currencies like ETH and DAI. When you trade NFTs on OpenSea using Polygon, there are no gas fees other than the one associated with getting your funds off of Ethereum and onto Polygon.
On third-party sites like Reddit, you may find forums of users unhappy with specific technical aspects of the platform, such as the design and layout. Still, I was unable to find anything particularly negative. In my opinion, the design and layout are perfectly adequate. OpenSea usually answers these concerns directly through their various support channels such as Discord and Telegram.
Is it safe?
The reputation of OpenSea is generally very good. There is no OpenSea scam.
There was one incident that made national headlines, and it has been handled. A former employee was purchasing NFTs that he knew were about to be listed on the main page in the ‘featured’ section.
2022 OpenSea review: Tweet about Insider Trading
In other words, this employee was trading on insider information.
Users on Twitter had been monitoring various wallet activities associated with the platform, and they noticed there was suspicious activity with one wallet in particular. After looking into it further, they discovered that it belonged to an OpenSea employee. Once notified, OpenSea began a full-scale investigation, and the employee resigned.
This is all well and good, but insider trading is a severe offense. If one were to be caught insider trading in the stock market, they would be prosecuted. In the case of OpenSea, they decided to let the employee leave and not take legal action against him.
Given that the IRS and SEC are far behind where they need to be when it comes to the enforcement surrounding NFTs, there may not be a trial for years – if ever.
This incident downgrades the overall rating for their reputation, but it is not a reason to avoid the platform altogether.
OpenSea is a seamless, powerful exchange that has made a lot of people a lot of money.
OpenSea supports the buying and selling of any ERC721 token. ERC721 is the name of all the code that governs Ethereum based NFTs. There are NFTs on other blockchains as well, which are not ERC721 tokens. There are many different NFT categories that users can choose from, including art, music, domain names, virtual worlds, trading cards, collectibles, sports, and utility NFTs.
OpenSea is not only an investment purchasing platform, but it is also built for traders. Trades happen instantaneously once a bid is accepted, and funds are directly transmitted to the NFT seller’s wallet and the NFT to the buyer’s wallet.
NFT sellers can list their digital assets through an open-ended auction, an auction with an expiration date, or a buy-now price.
OpenSea enables anyone with an Ethereum wallet to trade NFTs. These NFTs are priced in ETH, and all associated fees are paid in the ETH.
The silver/grey diamond next to the word ‘Last’ represents the ETH symbol in the image below. It’s the equivalent of $ representing the US dollar.
Every NFT on Ethereum is priced in ETH. Users are required to pay in ETH for the price of the NFT as well as for the associated gas fees. Fees will vary between $10 and $120. Gas fees also have to be paid in ETH, so make sure you always have some extra ETH to cover any unexpected gas fees.
When using the Polygon blockchain, you can see the difference in pricing as the diamond is now a purple color. When you search NFTs on the platform, you can filter them by NFTs on Ethereum and NFTs on Polygon. The ones that are grey/silver are on Ethereum, and these purple ones are on Polygon.
Remember, when using Polygon, you won’t have to pay any gas fees!
2022 OpenSea NFT Review: Examples of NFTs on Polygon
The user experience is seamless. You’ll have no issue navigating between pages, and there are no dead links. As stated in the background section, OpenSea has raised over $120 million to fund their company. You can bet they are making sure their users enjoy their experiences.
Design and Appearance
The design and appearance of OpenSea are very straightforward. You won’t have trouble finding anything, and you can search through the entire platform with filters such as price, rarity, how recently the NFT was listed for sale, and more.
The image above displays what the Marketplace tab looks like. The image below displays a home page for one of the most popular NFT projects out there – MekaVerse. There are description pages with metrics for each collection of NFTs.
Some NFTs are listed as 1/1s and do not have their own page like this, but for the collections that do – you can quickly learn a lot about them. Reading the above metrics from left to right details the following:
- Items – How many of the NFTs are created by this collection.
- Owners – How many unique wallet addresses own an NFT from this collection.
- Floor Price – The amount of ETH that the lowest NFT from this collection is listed for sale.
- Volume Traded – The amount of ETH that has been traded for these NFTs.
- At the time of writing, the ETH price was around $3,800. So the floor price for a Meka – 2.395 ETH – is $9,101. Some Mekas will be priced even higher, and some are not even listed on the platform as the owner has no intention of selling.
How to open an account?
Registering for OpenSea takes seconds. All you have to do is connect your digital wallet using the Connect button on the homepage.
OpenSea wallet options are any digital wallet that supports ERC20 tokens. ERC tokens refer to the ERC20 and ERC721 standards. These standards govern how the tokens operate on the Ethereum blockchain.
ERC20 tokens are fungible. Each one is equivalent to the other one. One UNI token, for example, is equal to another UNI token.
Every ERC721 token is non-fungible. Each one is verifiably unique and a one-for-one collectible. ERC721 tokens are NFTs.
According to the above image from OpenSea’s Help Center, you can see that many wallets work very well with OpenSea. Some are more suited for desktop use while others are more suited for mobile – and some even let you buy crypto within them directly with debit and credit cards. This crypto can then be used to purchase an NFT.
Wallet Connect is a service that helps connect any compatible wallet to the platform. Not only can you use any of the wallets listed above, but you can use any Ethereum compatible wallet. Ethereum compatible wallets are also compatible with Polygon’s blockchain, so don’t worry about creating a new Polygon wallet.
To be clear, once a bid is accepted, the bidder’s wETH is removed from their wallet, and the NFT is immediately transferred to the winner’s wallet.
OpenSea Mobile App
OpenSea recently released a high-quality mobile app that can directly connect to various wallets. The OpenSea mobile app is available for iOS and Android and has garnered 2,900+ reviews with an average review score of 4/7/5. Not too shabby.
Gas Free Marketplace
Through using the Polygon blockchain detailed above, OpenSea has succeeded in making the world’s first gas-free marketplace.
OpenSea enables users to create their own NFTs to sell on the platform. Image, video, audio, or 3D models can be uploaded and indexed by keywords and features of the NFT.
OpenSea has created a robust Help Center that should be able to answer all your questions. They include guides that detail every transaction process you’ll have to go through and some of the functionality behind the platform.
Along with the helpful resources, blog, newsletter, Telegram channel, and active Discord group, support tickets, and a 24/7 chat feature are also available. OpenSea is going all out to make sure you enjoy your time on the platform.
These efforts are beneficial, as many users have never used a digital wallet or purchased an NFT before.
Besides its helpful Help Center, OpenSea has introduced a suggestion box where users can submit proposals they would like to see enacted on the platform.
All deposits and withdrawals must be in ETH, although all bids must be made in wETH, which I explain below.
Some NFT platforms offer a token that can be used for payment. Even though there are plans for the company to go public, there is NO OpenSea token, so there is NO OpenSea token price.
Deposits are made in ETH, although they must be wrapped for them to be used to purchase an NFT. Wrapped ETH, denoted as wETH, is the ETH token that is compatible with the backend of the OpenSea platform. It enables users to make pre-authorized bids on NFTs. One wETH will always equal one ETH.
Withdrawals can be in either ETH or wETH. Wrapped ETH, denoted as wETH, in the form of the ETH token that is required.
If the price of ETH goes up, what happens to the price of NFTs?
This is an interesting question. It depends on what the people selling the NFTs want to do. If they list an item for 1 ETH when ETH is trading at $1000, they may want to relist the item at 2 ETH in the case of ETH dropping to $500. If they don’t relist it, someone can buy it for $500 and just wait until the price gets back to $1,000 before selling it for the same price of 1 ETH, still realizing a 100% profit.
It can be confusing to think in this way at first, as you have many moving parts, but the more you are exposed to it, the more you’ll get used to it. The same goes for digital wallets.
There are no withdrawal limits. You can sell an NFT for $1,000,000,000,000 and still be able to withdraw it to your wallet.
The withdrawal speed typically takes a few minutes.
If the network is congested, you can pay a higher gas fee for your transaction to be considered a priority, in which case, it will be confirmed very quickly. To do so, you’ll have to adjust your gas fee setting within the wallet you’re using to connect to the platform.
- Anonymous Purchases. All you need to do is connect a digital wallet. There’s no OpenSea wallet, so you can be sure that you’ll always be the one in control of your NFTs through non-custodial wallets like Metamask.
- A large Number of Collectibles. Millions of NFTs are available for sale on the platform.
- Active Community. There are new releases every day, and community growth has been trending up lately. There are over 400,000 monthly users.
- Strong Discord Community. You can voice concerns by joining their Discord with over 125,000 members, and platform moderators will get back to you.
- Established Team of Developers. This team of developers listed their LinkedIn profiles on the website and went through the coveted Y-Combinator startup program.
- High Transaction Fees. OpenSea is built on Ethereum, which currently has transaction fees ranging from $10 to $100 depending on how congested the network is.
- Previous Exploitation by Management. An employee was let go for being caught ‘front-running’ NFTs before they were featured on the platform’s main page.